Exploring Firm Decision-Making and Location Strategies in High-Tech Manufacturing Relocation in Beijing: A Lifecycle Perspective

Abstract

Over the years, much research has focused on industrial relocations between countries resulting from globalisation and industrial modernisation. However, the relocation decisions of individual firms within metropolitan areas remain an insufficiently studied aspect of the relocation literature. This study aims to fill this gap by examining the relocation intentions and locations of high-tech manufacturing firms at various stages of development in Beijing from the firm life cycle perspective. The results show that larger firms with more employees and higher property income are more willing to relocate. Interestingly, smaller firms do not follow the incubator theory, instead relocating to non-agglomerated areas. As firms grow, however, they tend to move to areas with higher firm concentration. This indicates that not all industrial clusters in cities function as business incubators. Furthermore, it also confirms the influence of rootedness, regional accessibility and regional policies on the relocation of firms.